To be precise, VAT is the latest addition to the tax reforms in the UAE. Nowadays, it is of utmost importance for a company to register for VAT in UAE so that they can charge VAT from their customers. Since its implementation, it is mandatory for businesses to opt for a TIN. Note that it is a unique number provided to businesses who have successfully registered for VAT. On the other hand, in Bahrain VAT, businesses with a value more than BHD 39000 should register on a compulsory basis. Furthermore, if the annual value of your exports or supplies exceeds 19000, you have the option to opt for the TIN.
Full-scale implementation of VAT is yet to commence
The process for VAT registration is yet to start. However, its nationwide implementation is very much on the cards and it would be announced by the tax authorities shortly. To ensure that you understand all the intricacies of the VAT and TIN process, you need to understand various terminologies and concepts. Let’s take the following instance for an example. Once all your business’ details and documents are submitted, the authorities of taxes would issue you with a unique registration number also known as the TIN.
Authorizes your business to charge VATs
Upon receiving the TIN, you can now charge VATs from your customers. However, note that you can collect VAT at 5% of the taxable supplies. Furthermore, if your business is registered under VAT, you need to pay the VAT along with its returns at definite time periods. Confirm with the tax authorities about the frequency of paying VAT returns as they can be on monthly or quarterly basis. This is where the TIN comes to the fore. During filing VAT returns, you have to mention the TIN. The TIN helps the authorities to identify your business. Also, any type of communication with the tax authorities also requires TIN.
Brief Overview of the TIN for Businesses
Well, it is normal to feel overwhelmed by the intricacies involved in obtaining the TIN. However, fret not as the following points would help you to comprehend VAT precisely.
- Your business would only receive a TIN only after its successful registration
- Note that the VAT registration process is yet to commence on a full-fledged basis. However, it would be started by the authorities soon
- For a business, the TIN should be mentioned in the debit note, credit note, returns on VAT and tax invoice
- The TIN would be issued by the tax authorities. Remember that no other government body is eligible to issue this number
- As per the latest tax laws, it is compulsory for business to mention the TIN in all the documents. Failure to do so can make you incur penalty charges
- It is expected that the Tin would be 15-digiuts long. However, it is for the tax authority to decide on its length
There are many services operating in Bahrain which do not require filing for the VAT registration process. So it is always a good idea to crosscheck with the authorities that whether your business needs filing VAT or not. Note that those businesses with more than 5 million dinars as annual sales would be eligible to register for VAT.
Your trusted aid in helping you register as a VAT compliant company
If you want assistance related to VAT registration, GCC Filings is your trusted partner. The company offers services on VAT registration, filing, company establishment in UAE, etc.